Abu Jakir :
After the fall of the Awami League government due to a popular uprising, the newly formed interim government, led by Dr. Mohammad Yunus, has embarked on several reform initiatives across different sectors.
However, one area where citizens are still awaiting relief is the rising cost of essential commodities, as inflation continues to strain lower and middle-income households.
According to the Trading Corporation of Bangladesh (TCB), in the two months since the new government took office, prices for six essential items have increased, while only two items have seen a decrease.
The surge in vegetable prices is particularly alarming, with eggs now costing up to 180 BDT per dozen, and prices of chicken and fish have also remained high, leaving consumers with little respite.
To combat inflation, Bangladesh Bank has raised interest rates and restricted the supply of currency in the market. While this has helped stabilise the U.S. dollar at around 120 BDT, it has also driven up costs for traders of essential commodities. Despite efforts to curb inflation, the impact on food prices has been limited.
Although overall inflation has slightly dropped below 10%, food inflation remains above this level, meaning that citizens now need over 110 BDT to purchase what they could buy for 100 BDT last year.
The Bureau of Statistics of Bangladesh (BBS) calculates inflation based on the prices of over 500 goods and services, but even a slight increase in the price of essential items puts significant pressure on low-income households. According to the BBS, while inflation reached nearly 10% in September, wages have only risen by around 8%, reducing people’s purchasing power.
The Ministry of Commerce, in response to soaring prices, requested that the National Board of Revenue (NBR) reduce import duties on onions, potatoes, and eggs. As a result, the prices of onions and potatoes have decreased slightly,
but other commodities continue to remain out of reach for many.
The ministry has held regular meetings to monitor the situation, but many decisions are hindered by objections from other government departments. Experts emphasise the need for coordinated action to reduce prices, and some suggest that the government should consider offering more tax relief to alleviate public suffering.
Market analysts generally agree that the decision to raise interest rates was correct, as it reduces money supply and lowers demand, but warn that this policy may not be as effective for essential items, which have consistent demand regardless of market conditions.
For instance, the price of eggs is determined by production costs and supply, and when people have less disposable income, the demand for basic food items like eggs actually increases.
In recent weeks, the TCB reported that prices of coarse rice, soybean oil, palm oil, chicken, sugar, and eggs have risen, while only onions and potatoes saw price reductions due to government interventions.
Meanwhile, vegetable prices continue to climb, with items such as eggplant now selling for 60-100 BDT per kilogram, compared to 40-80 BDT two months ago.
At Karwanbazar Kitchen Market, housewife Rehena Begum was haggling over the price of fish. She wanted to buy small-sized Rui fish at 300 BDT per kilogram, but seller Afzal, insisted that the price wouldn’t drop by a single taka.
Rehena Begum expressed her frustration, saying, “There’s no control over prices in the market.
Everyone is raising prices as they please. You can’t buy vegetables for less than 80-100 BDT. The price of eggs and fish keeps increasing. It’s a complete mess.”
Vegetable seller Ali Hossain added, “Every day, customers ask why the prices are so high. We have no answer for them. People are really suffering, and our profit margins have also decreased.”
As the government struggles to bring down inflation, the need for more targeted reforms in the supply chain and market regulation is becoming increasingly apparent.
Experts stress that without effective measures to stabilise the prices of daily essentials, the financial pressure on the general public will continue, and the new administration’s ability to provide economic relief will remain under scrutiny.
Following Russia’s invasion of Ukraine in February 2022, Bangladesh’s foreign currency reserves began to decline, and the value of the US dollar increased. This led to a steady rise in the prices of all goods.